Rose Petroleum PLC Update re disposal of Mexican milling operations (0918O)
August 16 2017 - 1:00AM
UK Regulatory
TIDMROSE
RNS Number : 0918O
Rose Petroleum PLC
16 August 2017
Prior to publication, the information contained within this
announcement was deemed by the Company to constitute inside
information as stipulated under the Market Abuse Regulations (EU)
No. 596/2014 ("MAR"). With the publication of this announcement,
this information is now considered to be in the public domain.
16 August 2017
Rose Petroleum plc
("Rose", the "Company" or the "Group")
Update on the disposal of Mexican milling operations
Rose (AIM: ROSE), the AIM quoted natural resources business, is
pleased to provide an update on the potential disposal of the
Company's mineral processing mill operation in San Dieguito de
Arriba, State of Nayarit, Mexico and its associated assets,
licenses and agreements (together, the "SDA Mill") to Magellan Gold
Corporation (OTCQB: MAGE) ("Magellan"), as initially announced on 6
March 2017.
On 1 August 2017, Rose announced that it had agreed an extension
to Magellan's option period, to enable Magellan to deliver executed
irrevocable bridge loan commitments representing not less than
$900,000 in cash required to fund the transaction, until 15 August
2017. Also under the terms of the option extension, Magellan was
required to reimburse Rose for the employee and maintenance costs
of the SDA mill of approximately US$25,000 per month for August and
September.
The Company is pleased confirm that it has received from
Magellan both the irrevocable commitment letters totalling
US$900,000 to fund the purchase and the first US$25,000 cash
payment relating to the August 2017 running costs of the mill. The
second payment is due on or before 1 September 2017.
Rose and Magellan are now pushing forward to complete the
transaction. Closing of the transaction is still subject to the
satisfaction of a number of conditions, including but not limited
to, approval by Rose's shareholders, the Group and Magellan
entering into a separate asset purchase agreement and both parties
completing their respective due diligence.
The total purchase price for the SDA Mill is agreed under the
Memorandum of Understanding between Rose and Magellan as US$1.5
million, payable as US$1.0 million in cash and US$500,000 in
restricted common stock (shares) in Magellan (less the US$100,000
option payment already received).
Should the transaction not complete due to it not being approved
by the Company's shareholders, Rose will be required to reimburse
Magellan the US$100,000 option payment already received. This
payment would be payable in cash or shares at the Company's
discretion.
Milling activity at the SDA mill remains on hold pending the
completion of this transaction.
Matthew Idiens, CEO commented: "We are pleased with the progress
being made on the disposal of the SDA Mill and, subject to signing
of the Sale and Purchase Agreement and satisfactory completion of
due diligence, we expect to be in a position to convene the general
meeting to seek shareholder approval to complete the disposal in
the coming weeks. We will keep the market updated on the
process."
Enquiries:
Rose Petroleum Tel: +44 (0)
plc 20 7225 4595
Matthew Idiens (CEO) Tel: +44 (0)
Chris Eadie (CFO) 20 7225 4599
---------------------- ---------------- ---------------
Jeremy Porter / James Allenby Capital Tel: +44 (0)
Reeve / Liz Kirchner Limited 20 3328 5656
James Pope / Ben Turner Pope Tel: +44 (0)20
Turner Investments 3621 4120
This information is provided by RNS
The company news service from the London Stock Exchange
END
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